Shell, Swiss Re want ‘unambiguous price on carbon’

The companies say that creating a cost for carbon emissions should be part of nation-based climate policies that can eventually be interwoven.

“To meet the longer term aspiration of embedding a carbon emissions price within the entire global economy, governments should work bilaterally and multilaterally to ensure common design elements between different market systems and to link up compatible systems,” the communiqué states.

Other companies signing the statement include Kodak, KPMG, EDF Energy, Alstom, Statoil and many others.

Policies to “price carbon” include a tax on emissions, and imposing a cap on emissions coupled with the buying and selling of emissions credits among polluters.

The companies say that while there are multiple ways to set a price on emissions, they prefer market-based approaches like emissions credit trading “which offer both environmental integrity and flexibility for business.”

However, proposals to price carbon have sputtered in the U.S. and face long odds politically.

Cap-and-trade legislation collapsed in Congress in 2010.

The White House says it will never propose a carbon tax, although the administration hasn’t ruled out the idea in the highly unlikely event that Republicans bring it forward in fiscal policy talks.

Obama said he’s seeking a “conversation” about a second-term climate agenda while touting first-term policies such as recently finalized rules to substantially toughen vehicle mileage standards though model year 2025.

The corporate communiqué arrives amid fresh warnings that current worldwide efforts won’t keep the increase in global temperatures below 2 degrees Celsius, the target set at prior U.N. talks that many scientists say is needed to avert the most dangerous effects of global warming.

A major new World Bank report warns of a 4 degree rise above pre-industrial levels by the end of the century, bringing devastating heatwaves, droughts and floods that hit many of the world’s poorest areas the hardest.

The new communiqué was developed through The Prince of Wales’s Corporate Leaders Group on Climate Change, with help from the World Business Council for Sustainable Development and the International Emissions Trading Association, the groups said.

It drew encouraging words from Connie Hedegaard, the European commissioner for climate action, who said the European Union will seek to sync its emissions trading system (ETS) with other nations.

“The ETS is Europe's flagship tool to meet our emission reduction target for 2020. We are planning to link our system with Australia's and encourage more countries to join the ETS family in order to drive down emissions globally,” she said.